BG Confirms Brazil’s Final Merger Clearance
British multinational oil and gas major BG Group plc has confirmed that the recommended cash and share offer for the company to be made by Royal Dutch Shell plc (Shell) has received final unconditional merger clearance from the Brazilian competition authority (CADE).
The unconditional clearance follows CADE’s initial approval of the combination on 8 July 2015, and the expiry of the 15 day period during which CADE’s decision could be appealed.
The approval is one of the five regulatory clearances that are pre-conditions to the combination and this is the first precondition to be satisfied.
Back in June, Shell received approval for the deal from US competition authorities.
Other pre-conditional approvals are required from Australia (anti-trust and foreign investment), China (anti-trust) and the European Union (anti-trust).
BG said that the filing process to obtain these approvals and the regulatory approvals required in other jurisdictions is well underway.
The combination will also require support from both BG Group and Shell shareholders.
If approved by all relevant parties, the USD 70 billion merger with BG will make Shell the largest Brazilian offshore foreign operator.
Shell expects the deal to accelerate its growth strategy in global LNG and deep water, as well as to add some 25% to its oil and gas reserves and 20% to production, each on a 2014 basis.
This combination will create the world’s largest LNG producer.